Exhibit 10.2


 


[EXECUTION]


 


CONTINUING GUARANTY


 


THIS GUARANTY (this “Guaranty”) is made as of June 29, 2004, by
the undersigned guarantor (whether one or more “Guarantor”, and if more
than one jointly and severally), in favor of BANK OF AMERICA, N.A., as administrative
agent for the Lenders under the Credit Agreement as defined below (in such
capacity, “Agent”).


 


FOR VALUE RECEIVED, the sufficiency of which is hereby acknowledged,
and in consideration of any credit and/or financial accommodation heretofore or
hereafter from time to time made or granted to WESTERN GAS RESOURCES, INC. (the
“Borrower”) by Lenders and any other subsidiaries or affiliates of
Lenders and their successors and assigns, pursuant to the Credit Agreement the
undersigned hereby furnishes its guaranty of the Guaranteed Obligations (as
hereinafter defined) as follows:


 


1.                                      Guaranty.  The Guarantor hereby absolutely and
unconditionally guarantees, as a guarantee of payment and not merely as a
guarantee of collection, prompt payment when due, whether at stated maturity,
upon acceleration or otherwise, and at all times thereafter, of any and all
existing and future indebtedness and liabilities of every kind, nature and
character, direct or indirect, absolute or contingent, liquidated or unliquidated,
voluntary or involuntary, of the Borrower to (i) the Agent and the Lenders
arising under that certain Amended and Restated Credit Agreement of even date
herewith between the Borrower, Agent and the Lenders (the “Credit Agreement”;
terms used and not defined herein shall have the meaning given them in the
Credit Agreement) and all instruments, agreements and other documents of every
kind and nature now or hereafter executed in connection with the Credit
Agreement (including all renewals, extensions and modifications thereof and all
reasonable costs, attorneys’ fees and expenses incurred by the Agent or any
Lender in connection with the collection or enforcement thereof owed pursuant
to the Loan Documents) and (ii) any Lender or any Affiliate of any Lender
arising under any Swap Contract between Borrower or any Affiliate of Borrower
and any Lender or any Affiliate of any Lender (collectively, the “Guaranteed
Obligations”) absent manifest error. 
The Lenders’ books and records showing the amount of the Guaranteed
Obligations shall be admissible in evidence in any action or proceeding, and
shall be binding upon the Guarantor and conclusive for the purpose of
establishing the amount of the Guaranteed Obligations.  This Guaranty shall not be affected by the genuineness,
validity, regularity or enforceability of the Guaranteed Obligations or any
instrument or agreement evidencing any Guaranteed Obligations, or by the
existence, validity, enforceability, perfection, or extent of any collateral
therefor, or by any fact or circumstance relating to the Guaranteed Obligations
which might otherwise constitute a defense to the obligations of the Guarantor
under this Guaranty.  Each of the
undersigned hereby agrees that its obligations hereunder shall be limited to an
aggregate amount equal to the largest amount that would not render its
obligations hereunder subject to avoidance under Section 548 of the
Bankruptcy Code (Title 11, United States Code) or any comparable provisions of
any applicable state law.


 


2.                                      No
Setoff or Deductions; Taxes. The Guarantor represents and warrants that it
is incorporated/organized and resident in the United States of America. All
payments by the Guarantor hereunder shall be paid in full, without setoff or
counterclaim or any deduction or withholding whatsoever, including, without
limitation, for any and all present and future taxes. If the Guarantor must
make a payment under this Guaranty, the Guarantor represents and warrants that
it will make the payment


 

















 


from one of its U.S. resident offices to the Agent, for the benefit of
the Lenders, so that no withholding tax is imposed on the payment.  If notwithstanding the foregoing, the
Guarantor makes a payment under this Guaranty to which foreign withholding tax
applies, or any taxes (other than taxes on net income (a) imposed by the
country or any subdivision of the country in which any Lender’s principal
office or actual lending office is located and (b) measured by the United
States taxable income such Lender would have received if all payments under or
in respect of this Guaranty were exempt from taxes levied by the Guarantor’s
country) are at any time imposed on any payments under or in respect of this
Guaranty including, but not limited to, payments made pursuant to this
Paragraph 2, the Guarantor shall pay all such taxes to the relevant authority
in accordance with applicable law such that such Lender receives the sum it
would have received had no such deduction or withholding been made and shall
also pay to such Lender, on demand, all additional amounts which such Lender
specifies as necessary to preserve the after-tax yield such Lender would have
received if such taxes had not been imposed.


 


The Guarantor shall promptly provide Agent and any such Lender with an
original receipt or certified copy issued by the relevant authority evidencing
the payment of any such amount required to be deducted or withheld.


 


3.                                      No
Termination.  This Guaranty is a
continuing and irrevocable guaranty of all Guaranteed Obligations now or
hereafter existing and shall remain in full force and effect until all
Guaranteed Obligations and any other amounts payable under this Guaranty are
indefeasibly paid and performed in full and any commitments of the Agent and
the Lenders or facilities provided by the Lenders with respect to the
Guaranteed Obligations are terminated. 
At the Agent’s option, all payments under this Guaranty shall be made to
an office of the Agent located in the United States and in U.S. Dollars.


 


4.                                      Waiver
of Notices.  The Guarantor waives
notice of the acceptance of this Guaranty and of the extension or continuation
of the Guaranteed Obligations or any part thereof.  Guarantor further waives presentment, protest, notice, dishonor
or default, demand for payment and any other notices to which the Guarantor
might otherwise be entitled.


 


5.                                      Subrogation.  The Guarantor shall exercise no right of
subrogation, contribution or similar rights with respect to any payments it
makes under this Guaranty until all of the Guaranteed Obligations and any
amounts payable under this Guaranty are indefeasibly paid and performed in full
and any commitments of the Agent and the Lenders or facilities provided by the
Lenders with respect to the Guaranteed Obligations are terminated.  If any amounts are paid to the Guarantor in
violation of the foregoing limitation, then such amounts shall be held in trust
for the benefit of the Agent and shall forthwith be paid to the Agent to reduce
the amount of the Guaranteed Obligations, whether matured or unmatured.


 


6.                                      Waiver
of Suretyship Defenses.  The
Guarantor agrees that the Agent and/or the Lenders may, at any time and from
time to time, and without notice to the Guarantor, make any agreement with the
Borrower or with any other person or entity liable on any of the Guaranteed Obligations
or providing collateral as security for the Guaranteed Obligations, for the
extension, renewal, payment, compromise, discharge or release of the Guaranteed
Obligations or any collateral (in whole or in part), or for any modification or
amendment of the terms thereof or of any instrument or agreement evidencing the
Guaranteed Obligations or the provision of collateral, all without in any way
impairing, releasing, discharging or otherwise affecting the obligations of the
Guarantor under this Guaranty.  The
Guarantor waives any defense arising by reason of any disability or other
defense of the Borrower or any other guarantor, or the cessation from any cause
whatsoever of the liability of the Borrower, or any claim that the Guarantor’s
obligations exceed or are more burdensome than those of the Borrower and waives


 


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the benefit of any statute of limitations affecting the liability of
the Guarantor hereunder.  The Guarantor
waives any right to enforce any remedy which the Agent and/or the Lenders now
have or may hereafter have against the Borrower and waives any benefit of and
any right to participate in any security now or hereafter held by the Agent
and/or the Lenders.  Further, the
Guarantor consents to the taking of, or failure to take, any action which might
in any manner or to any extent vary the risks of the Guarantor under this
Guaranty or which, but for this provision, might operate as a discharge of the
Guarantor.


 


7.                                      Exhaustion
of Other Remedies Not Required.  The
obligations of the Guarantor hereunder are those of primary obligor, and not
merely as surety, and are independent of the Guaranteed Obligations.  The Guarantor waives diligence by the Agent
and the Lenders and action on delinquency in respect of the Guaranteed
Obligations or any part thereof, including, without limitation any provisions
of law requiring the Agent and/or the Lenders to exhaust any right or remedy or
to take any action against the Borrower, any other guarantor or any other
person, entity or property before enforcing this Guaranty against the
Guarantor, including but not limited to the benefits of Sections 34.02 and
34.03 of the Texas Business and Commerce Code, §17.001 of the Texas Civil
Practice and Remedies Code, and Rule 31 of the Texas Rules of Civil Procedure,
or any similar statute.


 


8.                                      Reinstatement.  Notwithstanding anything in this Guaranty to
the contrary, this Guaranty shall continue to be effective or be reinstated, as
the case may be, if at any time any payment of any portion of the Guaranteed
Obligations is revoked, terminated, rescinded or reduced or must otherwise be
restored or returned upon the insolvency, bankruptcy or reorganization of the
Borrower or any other person or entity or otherwise, as if such payment had not
been made and whether or not the Agent or any Lender is in possession of or has
released this Guaranty and regardless of any prior revocation, rescission,
termination or reduction.


 


9.                                      Subordination.  The Guarantor hereby subordinates the payment
of all obligations and indebtedness of the Borrower owing to the Guarantor,
whether now existing or hereafter arising, including but not limited to any
obligation of the Borrower to the Guarantor as subrogee of the Agent and the
Lenders or resulting from the Guarantor’s performance under this Guaranty, to
the indefeasible payment in full of all Guaranteed Obligations. If any Event of
Default as defined in the Credit Agreement shall have occurred and be
continuing and the Agent so requests, any such obligation or indebtedness of
the Borrower to the Guarantor shall be enforced and performance received by the
Guarantor as trustee for the Agent and the proceeds thereof shall be paid over
to the Agent, for the benefit of the Lenders, on account of the Guaranteed
Obligations, but without reducing or affecting in any manner the liability of
the Guarantor under this Guaranty.


 


10.                               Information.  The Guarantor agrees to furnish promptly to
the Agent any and all financial or other information regarding the Guarantor or
its property as the Agent may reasonably request in writing.


 


11.                               Stay
of Acceleration.  In the event that
acceleration of the time for payment of any of the Guaranteed Obligations is
stayed, upon the insolvency, bankruptcy or reorganization of the Borrower or
any other person or entity, or otherwise, all such amounts shall nonetheless be
payable by the Guarantor immediately upon demand by the Agent.


 


12.                               Expenses.  The Guarantor shall pay on demand all
reasonable out-of-pocket expenses (including reasonable attorneys’ fees and
expenses) in any way relating to the enforcement or protection of the Agent’s
and the Lenders’ rights under this Guaranty, including any incurred in the
preservation, protection or enforcement of any rights of the Agent and the
Lenders in any case commenced by or against the Guarantor under the Bankruptcy
Code (Title 11, United States Code) or any similar or


 


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successor statute.  The
obligations of the Guarantor under the preceding sentence shall survive
termination of this Guaranty.


 


13.                               Amendments.  No provision of this Guaranty may be waived,
amended, supplemented or modified, except by a written instrument executed by
the Agent (with the consent of Lenders as required under the Credit Agreement)
and the Guarantor.


 


14.                               No
Waiver; Enforceability.  No failure
by the Agent or any Lender to exercise, and no delay in exercising, any right,
remedy or power hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy or power hereunder preclude any
other or further exercise thereof or the exercise of any other right.  The remedies herein provided are cumulative
and not exclusive of any remedies provided by law or in equity.  The unenforceability or invalidity of any
provision of this Guaranty shall not affect the enforceability or validity of
any other provision herein.


 


15.                               Assignment;
Governing Laws; Jurisdiction.  This
Guaranty shall (a) bind the Guarantor and its successors and assigns, provided
that the Guarantor may not assign its rights or obligations under this Guaranty
without the prior written consent of the Agent and the Lenders as provided in
and in accordance with the Credit Agreement (and any attempted assignment
without such consent shall be void), (b) inure to the benefit of the Agent and
the Lenders and their successors and assigns and the Agent and Lenders may, as
provided in and in accordance with the Credit Agreement and without affecting
the Guarantor’s obligations hereunder, assign or sell participations in the
Guaranteed Obligations and this Guaranty, in whole or in part, and (c) be
governed by the internal laws of the State of Texas.  The Guarantor hereby irrevocably (i) submits to the non-exclusive
jurisdiction of any United States Federal or State court sitting in Dallas,
Texas in any action or proceeding arising out of or relating to this Guaranty,
and (ii) waives to the fullest extent permitted by law any defense asserting an
inconvenient forum in connection therewith. 
Service of process by the Agent in connection with such action or
proceeding shall be binding on the Guarantor if sent to the Guarantor by
registered or certified mail at its address specified below.  The Guarantor agrees that the Agent and the
Lenders may disclose to any prospective purchaser and any purchaser of all or
part of the Guaranteed Obligations any and all information in the Agent’s and
Lenders’ possession concerning the Guarantor, this Guaranty and any security
for this Guaranty.


 


16.                               Condition
of the Borrower.  The Guarantor
acknowledges and agrees that it has the sole responsibility for, and has
adequate means of, obtaining from the Borrower such information concerning the
financial condition, business and operations of the Borrower as the Guarantor
requires, and that the Agent and the Lenders have no duty, and the Guarantor is
not relying on the Agent or any Lender at any time, to disclose to the
Guarantor any information relating to the business, operations or financial
condition of the Borrower.


 


17.                               Setoff.  If and to the extent any payment is not made
when due hereunder, the Lenders may setoff and charge from time to time any
amount so due against any or all of the Guarantor’s accounts or deposits with
the Lenders.


 


18.                               Other
Guarantees.  Except as set forth in
paragraph 21, this Guaranty is not intended to supersede or otherwise affect
any other guaranty now or hereafter given by the Guarantor in favor of Agent,
for the benefit of the Lenders, or any term or provision thereof.


 


19.                               Representations
and Warranties.  The Guarantor
represents and warrants that (i) it is duly organized and in good standing
under the laws of the jurisdiction of its organization and has full capacity
and right to make and perform this Guaranty, and all necessary authority has
been obtained; (ii)


 


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this Guaranty constitutes its legal, valid and binding obligation
enforceable in accordance with its terms; (iii) the making and performance of
this Guaranty does not violate the provisions of any applicable law, regulation
or order, and does not and will not result in the breach of, or constitute a
default or require any consent under, any material agreement, instrument, or
document to which it is a party or by which it or any of its property is bound
or affected, except as could not reasonably be expected to have a Material
Adverse Effect; (iv) all consents, approvals, licenses and authorizations of,
and filings and registrations with, any governmental authority required under
applicable law and regulations for the making and performance of this Guaranty
have been obtained or made and are in full force and effect; (v) by virtue of
its relationship with the Borrower, the execution, delivery and performance of
this Guaranty is for the direct benefit of the Guarantor and it has received
adequate consideration for this Guaranty; and (vi) the financial information,
that has been delivered to the Agent and the Lenders by or on behalf of the
Guarantor, is complete and correct in all material respects and accurately
presents the financial condition and the operational results of the Guarantor
and since the date of the most recent financial statements delivered to the
Agent, there has been no material adverse change in the financial condition or
operational results of the Guarantor.


 


20.                               WAIVER
OF JURY TRIAL; FINAL AGREEMENT.  TO
THE EXTENT ALLOWED BY APPLICABLE LAW, THE PARTIES HERETO EACH WAIVE TRIAL BY
JURY WITH RESPECT TO ANY ACTION, CLAIM, SUIT OR PROCEEDING ON OR ARISING OUT OF
THIS GUARANTY.  THIS GUARANTY REPRESENTS
THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE
OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.


 


21.                               AMENDMENT
AND RESTATEMENT.  This Guaranty restates and amends in its entirety (i)
that certain Guaranty dated as of April 24, 2003, executed by MIGC, Inc.,
Western Gas Resources-Texas, Inc., MGTC, Inc., Mountain Gas Resources, Inc.,
Lance Oil & Gas Company, Inc., and Western Gas Wyoming, L.L.C., in favor of
Agent, and all of the terms and provisions hereof shall supersede the terms and
provisions thereof.


 


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Executed as of the date first written.


 


 


	
   

  	
  MIGC, INC.

  
	
   

  	
  WESTERN GAS RESOURCES - TEXAS, INC.

  
	
   

  	
  MGTC, INC.

  
	
   

  	
  MOUNTAIN GAS RESOURCES, INC.

  
	
   

  	
  LANCE OIL & GAS COMPANY, INC.

  
	
   

  	
   

  
	
   

  	
  WESTERN GAS WYOMING, L.L.C.

  
	
   

  	
  By:  Western Gas Resources, Inc., its
  sole member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William J. Krysiak

  	
   

  
	
   

  	
   

  	
  William
  J. Krysiak

  
	
   

  	
   

  	
  Executive
  Vice President and Chief Financial

  
	
   

  	
   

  	
  Officer
  of each Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address of each Guarantor:

  
	
   

  	
   

  
	
   

  	
  1099 18th Street, Suite 1200

  
	
   

  	
  Denver, CO 80202

  



 

















 


	
   

  	
  BANK
  OF AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Richard L. Stein

  	
   

  
	
   

  	
   

  	
  Name:
  Richard L. Stein

  
	
   

  	
   

  	
  Title:
  Principal